Entrepreneur and NBA team owner Mark Cuban has invested in and started businesses for years, but only one of those companies features his name. Recent commentary from Cuban shows how passionate he is about transforming the U.S. healthcare system.
What Happened: Cuban launched the Mark Cuban Cost Plus Drug Company in 2022 to help lower the cost of medicines for consumers.
Starting with what Cuban called the low-hanging fruit of generic drugs, the company has now partnered with several non-generics offered at cheaper prices to consumers.
Cuban recalled starting the company during a recent appearance on the Bio Eats World podcast with guest host Vijay Pande, a founding investor in the a16z Bio + Health Fund.
Cuban said he saw that Republicans had a desire to overturn the Affordable Healthcare Act (ACA) when they took over Congress and couldn’t help but think, okay what’s next?
The entrepreneur got a cold email in 2018 or 2019 from a doctor who was working on starting a compounding pharmacy with the goal of taking generic drugs that were on a shortage list and filling them at a reasonable price.
It was also around this time that Martin Shkreli, aka the Pharma Bro, was thrown in jail after jacking up the cost of an HIV drug.
Cuban said if someone could jack up the price there could also be an opportunity to cut prices, with an inefficient market.
The number one missing element in healthcare, which is trust. You trust your doctor but after that there’s no one,” Cuban said. “That was the genesis of the creation of Cost Plus.”
Cuban said that securing licenses, acquiring software rights, and establishing credibility for his created company took several years. The firm now offers more than 1,100 medications, while maintaining complete transparency about its costs and pricing.
“That’s why I put my name on it, it’s the only company I put my name on.”
Related Link: Mark Cuban Helping Lower Cost Of Bestselling Humira WIth Cost Plus Drug Company: 'The Game Just Changed'
What’s Next: Cuban called the healthcare and pharmaceutical industries broken and in need of change.
“The big PBM’s (pharmacy benefit managers) don’t want this to happen,” Cuban said.
Cuban said the PBMs are owned by insurance companies or by pharmaceutical companies, and they can “left pocket, right pocket the revenue,” finding ways to get more money from consumers.
For the future, Cuban said he would like to see the pharmaceutical industry change and go back to the 1950s when pharmacies bought medications, sold medications and gave advice.
“There’s things designed to only get benefits for health care insurance companies.”
One solution offered up by Cuban is to turn the pharmaceutical industry into one similar to a streaming giant.
“It’s gotta be more of a Netflix model.”
In his analogy, Cuban compared the company's model to that of Netflix, noting that Netflix provides access to its entire library for a fixed price based on a time duration.
“Whatever content they have you get for that price during that time. It’s a silly analogy on some levels.”
Cuban said there should be a market-based model that offers transparency and makes the general ledger open 24/7 on a read-only basis to anyone who wants to see it.
“If we’re gonna change healthcare, that’s what it’s going to take.”
Cuban said there’s an ongoing discussion about making salaries more transparent and that could be applied to healthcare and the costs for consumers in an industry that’s not aligned with getting patients healthy, but rather is worried about profits.
Cost Plus is working to change the game and Cuban said of all the businesses he’s ever run, this one is his favorite. The entrepreneur said it’s great when people walk up to him on the street or tweet at him about themselves or family members being able to afford their medication.
When asked who annoys him more, PBMs or NBA officials, Cuban added it’s the NBA official as he at least knows what PBMs are doing and trying to increase their profits and share price.
Read Next: 5 Things You Might Not Know About Mark Cuban
Photo: Gage Skidmore on flickr and Shutterstock
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